Why It’s A Problem For Chipotle That No One Wants Its Queso

Image courtesy of Chipotle

Negative social media reactions don’t always hurt a product’s sales, but in the case of Chipotle’s new queso dip, it appears that no one is rushing out to try the menu addition — and those who do purchase the queso may be taking away from sales of other items on the Chipotle menu

Queso’s not catching on

According to Markets Insider, BMO Capital Markets sent analysts to 20 locations in New York City, and tallied up the orders that it observed — and the news is not great if Chipotle was hoping for queso to significantly boost its sales. Only 15% of the orders included the cheese sauce on the entrée or as a side dish, while 40% included guacamole.

Wait — it actually gets worse: BMO’s restaurant analyst assumes that queso sales are probably cannibalizing some guacamole sales. This, because two-thirds of the all the orders that included queso had it added on top of a entree. Adding it to an entree is cheaper than asking for a dollop of guacamole, but ordering queso as a side dish with chips is more expensive than ordering guac and chips.

For example, here in Albany, NY, queso costs $1.30 to add to a burrito or bowl. A bowl of queso by itself costs $2.15, while a small chips and queso serving costs $3.50. A large chips and queso costs $5.45.

Guacamole as an entrée add-on costs $2.05, but guac and chips are ten cents cheaper than queso and chips at $3.40.

If people who otherwise would have had guacamole on their burrito are mostly getting the cheaper queso, then the new product is actually losing Chipotle money. But if everyone starts ordering a side of queso with chips, well, that might be better for Chipotle’s bottom line.

Cheese haters are gonna hate

In an internal memo that Bloomberg News obtained, the company’s chief marketing officer assures employees that customers like the queso just fine, and that while the company has “made progress in making it smoother,” it will never be identical to a dip using processed cheese products.

(Informal Consumerist testing found queso to be quite tasty, but it draws your attention to the chain’s thicker tortilla chips more than the guacamole does.)

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